If the U.S. House of Representatives has its way, big changes are on the horizon for private offerings. In an effort to enhance the ability of small businesses to raise capital, the House has now passed four bills that reduce some of the restrictions. The bills are as follows: 1) Entrepreneurial Access to Capital Act […]
First Proxy Access Proposal Received
Late last week, a shareholder activist filed, what is believed to be, the first proxy access resolution for this proxy season. The target of the proposal, MEMC Electronic Materials, Inc., is an S&P 500 company that manufactures and sells wafers and related products to the semiconductor and solar industries. As discussed in a previous blog […]
SEC May Have Grossly Underestimated the Costs of Proposed Conflict Mineral Disclosure Rules
Section 1502 of the Dodd-Frank Act mandates the SEC to adopt rules requiring reporting companies to disclose whether certain minerals used in production chains originate from the Democratic Republic of the Congo or its neighboring countries. Minerals sourced from these areas of central Africa often fund militia and other military groups’ operations which have exacerbated […]
FINRA Proposes Rule 5123 (Private Placement of Securities)
Earlier this month, FINRA proposed new Rule 5123 to regulate private offerings. Proposed Rule 5123 is a second attempt by FINRA this year to expand the regulatory process on private offerings. In January, FINRA had proposed a much more comprehensive set of changes, including proposed regulations affecting private placements not involving a FINRA member firm. […]
“Positive Events in Small Company Capital Raising Arena”
The economic events of recent years have hit small companies particularly hard. While virtually everyone has suffered, small companies endured a double hit as they experienced substantial challenges to sales and profitability as well as a widespread inability to raise capital. This inability to raise capital was made worse by these economic events, but the […]
Has New Life Been Given to Derivative Suits Based on Failed Say-On-Pay Votes?
Section 951 of the Dodd-Frank Act states that the results of a shareholder say-on-pay advisory vote will not trigger or imply a breach of fiduciary duty. Because Congress went out of its way to be explicitly clear on this point, most legal commentators felt that shareholder derivative suits based on failed say-on-pay votes, without more, […]
SEC Considering Petition to Adopt Rules Requiring Disclosure of Political Contributions
The SEC is currently considering a petition submitted by a group of 10 law professors asking the SEC to adopt rules that would require public reporting companies to disclose political contributions in their annual proxy statements. As justification for the proposal, the petitioners assert that there is empirical evidence that indicates public company shareholders are […]
Want to Sign Up for Regulation by the Federal Reserve?
Considering the time and expense it takes to comply with many of the Federal Reserve rules, it seems odd that any company would volunteer to be regulated. But some want to sign up. In particular, some foreign companies that own a securities broker or dealer are required to register in the U.S. to do business […]
Proxy Access Still on the Table
Despite the SEC’s decision not to appeal the recent decision by the U.S. Court of Appeals for the D.C. Circuit to vacate the proxy access rules, proxy access is still alive and well. In Tuesday’s release by the SEC, the SEC noted that the amendment to Rule 14a-8, which had been stayed pending the litigation […]
Controversial Bill Would Require Additional “Social Disclosures” for Reporting Companies
The Dodd-Frank Act mandated the SEC to adopt rules to require reporting companies to make certain “social disclosures.” For example, Section 1502 of Dodd-Frank requires the SEC to adopt disclosure rules that will require reporting companies to make certain disclosures if “conflict minerals” are “necessary to the functionality or production” of its manufactured products. Metals […]
